Sun Hung Kai Properties Insurance keeps strong underwriting profitability

It also outperformed industry peers, AM Best notes.

Sun Hung Kai Properties Insurance Limited (SHKPI) is expected to continue financial stability, supported by its strong balance sheet and solid operating performance, according to AM Best. 

The company’s risk-adjusted capitalisation remained at the strongest level as of the fiscal year ending 30 June 2024. 

A shift towards cash and high-quality bonds has further strengthened its financial position, reducing exposure to China’s real estate sector. 

AM Best expects this conservative investment strategy to help SHKPI absorb potential market volatility.

SHKPI has maintained strong underwriting profitability, outperforming industry peers. In fiscal year 2024, its double-digit return on equity was driven by favourable underwriting results and higher investment returns, aided by rising interest rates. 

AM Best anticipates the company will continue benefiting from its parent group’s business, which provides stable premium income and minimises acquisition costs.

Whilst SHKPI holds a modest share of Hong Kong’s general insurance market, its focus on commercial and employees' compensation insurance, along with its low-cost business model, supports stable profitability. 

AM Best expects these factors to sustain SHKPI’s strong financial standing in the near term.